Netherlands Businesses Cutting Ties With Israel’s Occupation

In recent weeks, Israel and especially advocates for its right-wing in the United States have been scrambling to lash back at a boycott resolution passed by the American Studies Association (ASA). This was an initiative of an academic group in the United States directed at all of Israel in support of the Palestinian civil society call for boycott, divestment and sanctions (BDS) against Israel. But all of this activity against the ASA has overlooked a much more important act of economic pressure against Israel — this one from Europe.

The ASA boycott has divided peace activists, some of whom support economic actions against settlements and the occupation but not against Israel as a whole. Others have been reluctant to support the ASA action because they support certain actions against Israel but not an academic boycott. While there has been a good deal of support for the ASA action from the broader BDS movement, these questions have left the ASA action more open to attack from those who oppose any sort of action that might compel Israel to change its policies.

And such groups have moved swiftly. Many universities have disavowed the ASA action, a few even going so far as to withdraw from membership in the association. The Conference of Presidents of Major Jewish Organizations has led a charge among well-heeled Jewish groups to push for further actions against the ASA, with some gearing up to file a legal challenge to the ASA’s tax-exempt status (a challenge that would certainly fail, but is the sort of tactic a small academic association is threatened by just because of the cost of defending themselves).

All of this commotion has occurred over a resolution that will have very little material impact in and of itself on Israel. American Studies programs are not among the leading ones that interact with Israeli academic institutions to begin with. The boycott does not stop individual academics from working together, either from the US or Israel; it merely prohibits interaction with academics acting not as scholars but as “ambassadors of their institutions”.

It is of symbolic significance, to be sure. The ASA resolution opens the door for other academic boycotts, and if these should ever extend into physical science research or other technical fields where US-Israeli academic cooperation is financially, technologically or militarily significant (and there are many of those) it could be a much bigger deal. And, of course, it increases the general sense of isolation that is slowly but surely increasing in Israel over its policies.

But in fact, there have been significant developments with a European country that present a much more concrete and impactful problem for Israel. The Netherlands has seen a number of its companies terminate cooperation with Israeli companies over Israel’s ongoing occupation. The latest is PGGM, the largest Dutch pension management fund. PGGM made the decision to divest all its funds from Israel’s five largest banks because all of them are involved in some way in the settlements. The amount of money is not huge, estimated at several tens of millions of euros, but Israel is concerned that other financial institutions may follow suit and that, despite its official stance, the Netherlands government is creating an atmosphere which encourages boycotts and divestment from Israel.

There’s reason to believe that such an atmosphere exists and is growing in the Netherlands. PGGM’s decision is the latest in a series of Dutch businesses cutting ties with any Israeli venture that is connected to the settlements. Last month, a Dutch water company cut ties with Israel’s national water company, Mekorot, because of its operations in the settlements. In September, a major Dutch engineering firm canceled a contract to work on a sewage treatment plant because the project was located in East Jerusalem, beyond the Green Line (the border of Israel before it captured the West Bank in 1967). That cancellation was said to have been pushed for by the Netherlands’ government.

The Dutch government’s stance is that it “opposes any boycott of Israeli companies or institutions, in line with its standing policy.” Yet it has also warned companies that it might decide to enter into contracts that entail operations in or could fund the settlements to carefully examine the potential legal ramifications of such agreements.

Unlike the ASA boycott, the Dutch trend has specifically targeted the settlements, scrupulously avoiding a broad boycott of Israel, and the companies have cited their own ethical concerns rather than solidarity with Palestinian civil society as the impetus for their decisions. But these actions show the inherent complications of aiming a boycott only at the settlement and infrastructure that supports them.

PGGM’s divestment targets Israel’s five largest banks. Those banks could not, even if they wished to, do business exclusively within Israel’s 1967 borders. The connection between Israel and the settlements is much too complete for that, even if it would be legal for the banks to act in such a manner under Israeli law (it isn’t). Similarly, Mekorot is Israel’s national water company and must, therefore, operate in the West Bank. It’s just not possible to significantly target the settlements only in a way that Israel proper would not feel.

What Israel sees, therefore, in these kinds of economic actions is the very real possibility that the whole country will begin to feel the sting of global disapproval of its nearly 48-year old occupation, its settlement enterprise, its ongoing denial of Palestinian rights, and its intransigence in negotiations. A warning similar to the one the Netherlands issued to its businesses was circulated in England as well. If that trend grows, Israel has reason to fear significant economic backlash.

The Netherlands may be particularly inclined to encourage such actions, even if they don’t technically change their official policy. In Early December, just as their Prime Minister was coming to Israel for an official visit, Israel pulled the plug at the last minute on a Dutch scanner which would have allowed Palestinians from Gaza to export a great deal more goods through the Kerem Shalom crossing than they currently do. The scanner would have detected any illicit material in the exports, and Israel agrees it would work. But just before it was to be installed, Israel balked because the Netherlands insisted that it be used to increase exports from Gaza.

This sort of behavior certainly seems likely to encourage the Netherlands to clamp down harder on even the most indirect contribution to the occupation. And it may send a similar message to the rest of Europe, where Israel conducts the bulk of its trade. That is a lot more significant than a 400-member academic society boycotting Israel. But since the little academics are the ones the fanatical supporters of Israel can lash back at, that’s who is targeted.

That’s good news for those who believe that economic pressure is the only thing that will get Israel to change its stances regarding the Palestinians. We may be seeing the initial stages of that idea being put to the test.

Mitchell Plitnick

Mitchell Plitnick is former vice president of the Foundation for Middle East Peace. He is the former director of the US Office of B’Tselem: The Israeli Information Center for Human Rights in the Occupied Territories, and was previously the director of education and policy for Jewish Voice for Peace. He is a widely published and respected policy analyst.
Born in New York City, raised an Orthodox Jew and educated in Yeshiva, Mitchell grew up in an extremist environment that passionately supported the radical Israeli settler movement.
His writing has appeared in the Jordan Times, Israel Insider, UN Observer, Middle East Report, Global Dialogue, San Francisco Chronicle, Die Blaetter Fuer Deutsche Und Internationale Politik, Outlook, and in a regular column for a time in Tikkun Magazine. He has been interviewed by various outlets including PBS News Hour, the O’Reilly Factor and CNBC Asia.
Plitnick graduated with honors from UC Berkeley in Middle Eastern Studies and wrote his thesis on Israeli and Jewish historiography and earned his Masters Degree from the University of Maryland, College Park's School of Public Policy.

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4 Comments

The Israeli public will absorb the message from the boycott long before it has significant economic impact. That is the positive lesson from the senior Bush administration’s withholding of housing bond guarantees. I agree that the more narrowly targeted the boycott is to the post-1967 occupation the better.

You wrote: “Israel pulled the plug at the last minute on a Dutch scanner which would have allowed Palestinians from Gaza to export a great deal more goods through the Kerem Shalom crossing than they currently do. The scanner would have detected any illicit material in the exports, and Israel agrees it would work. But just before it was to be installed, Israel balked because the Netherlands insisted that it be used to increase exports from Gaza.”

The story about the scanners (it are in fact two scanners, in different places) is an intriguing one in itself, that started already under the predecessor (Mr. Uri Rosenthal, liberal and extremely ‘pro-Israel’) ) of the current Secretary of Foreign Affairs, Mr. Frans Timmermans, social-democrat, still ‘pro-Israel’, but less extreme, and with an eye for Palestinian interests. I’ll tell that story later.

The last minute dispute in december 2013 about the scanner at Kerem Shalom crossing originated from the Dutch insisting that the scanner also should be used to monitor exports from Gaza to the West Bank, the IDF stubbornly refusing to allow this, for you guess, indeed, ‘security reasons’. The logic here is: you have a scanner installed to monitor exports ‘for security reasons’, and you don’t allow to operate it, ‘for security reasons’. To this newly invented category of logic comes the fact that it was mainly on Israeli demand that the scanners were donated by the former Dutch government, and that it were the Israelis themselves who were supposed to oversee the operation of the scanners. So what is the problem? There is no problem.

What is the real reason then to let the scanner rost away? Isael under no circumstances whatsoever wants Gaza to be ‘connected’ to the West Bank. It is the policy of separating Palestinians from each other, in particular Gaza from the West Bank, and dividing them, not even allowing West Bank Palestinians to eat Gaza strawberries, or to buy Gaza flowers, that is the real motivation behind the last minute decision to cancel the start-up of the Kerem Shalom scanner. Our prime minister then -angrily- had to cancel the festivities designed to celebrate the inauguration of the scanner. As Mr. Timmermans said, when asked: “if you organize a party, but there is nothing left to celebrate, you cancel the party, of course.”

So the Dutch thanks to the Israelis missed an unique opportunity to contribute to a thousand years of Middle East peace.

At some point in time, it seems that more members of the E.U. would/will join a boycott of the Israeli practice of growing settlements at the expense of the Palestinians. I might add too, that the U.S. at some point, would say its had enough of the face slapping by the Netanyahoo group, returning in spades the present “bitch-slapping” Kerry gets from the same group in regards to seeking a settlement to the so called peace problem. Perhaps that’s in the effort that is being waged today.?

I am not a believer in sanctions and certainly not in violence, because they hurt the ordinary people and seldom produce the desired results. Of course while Iran has been under crippling sanctions and indeed a form of embargo, including its banks, assets, exports, shipping, etc. for her non-existent nuclear weapons’ program many may be tempted to do the same to Israel for her real nuclear arsenal and for the violation of Palestinian rights.

However, I believe what really needs to be done is to put pressure on the government to change its policy of total support for all rightwing Israeli policies, because in the long-term that will be in Israel’s best interest. While Secretary Kerry is trying to revive the peace process he should be brave enough to call for the minimum of Palestinian rights, as set out in the Camp David agreement, and not to dilute it with further Israeli demands, such as forcing the Palestinians to recognize Israel as a Jewish state, keep most of the settlements in the occupied territories or stationing Israeli forces in the West Bank.

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